Question: Indicate whether the following statements are True or False regarding tax planning and corporate distributions. a . Under current law, shareholders prefer dividends because salaries,

Indicate whether the following statements are "True" or "False" regarding tax planning and corporate distributions.

.

Under current law, shareholders prefer dividends because salaries, interest, and rent are fully taxed while dividends receive preferential tax treatment.

TrueFalseFalse

.

Even if shareholders structure their dealings with the corporation on an arm's length basis, constructive dividend situations cannot be avoided.

TrueFalseFalse

.

Individual taxpayers who pay the alternative minimum tax should reconsider their investment strategies to manage the mix of ordinary income, dividend income, and capital gain.

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